You have been doing research making it your second full time job to search for homes. If you are like most potential buyers your search begins online checking the MLS site or the vast majority of others that list homes for sale within your given area. Perhaps you come across a great property and find that the contract is pending. Maybe you find a home and it is listed as contingent.
Do terms like these have you wracking your brain and impeding your search? If so, you are not alone. Real Estate Ink in Brevard County, FL knows how important it is for buyers to be informed. We work closely with all of our clients to ensure that they have all the data they need to make an informed choice. Here’s a breakdown of terminology that you may encounter on your search.
Pending
When a home is pending it simply means that a contract is in place between a buyer and seller but the property has not closed. Many buyers find the perfect home only to discover that it is pending. Don’t lose heart just yet. Many sellers will often accept back up offers just in case the deal does not go through. This will be displayed as a C following your MLS number in the search criteria.
Contingent
Contingent contracts mean that a home sale is pending but is contingent on satisfactorily completing certain check list items. Generally speaking, contingency clauses give a buyer the opportunity to back out of a contract if the contingencies are not met. According to Realtor.com, contingencies typically fall into three categories: mortgage, appraisal, and home inspection. Provided the contingency is met, most home sales go through. There can also be a contingency for other factors, such as contingent on the sale of the buyer’s existing home. This type of contingency may have a “kick out clause” which means they only have a certain amount of time to satisfy the contingency before the sellers place the home back on the market. This will also be displayed as a C following your MLS number.
Active
This one is pretty simple. Property that is listed as active is ready and still available for sale. This will be displayed as a A following your MLS number.
Short Sale
When a home is up for a short sale it means that the owner is selling for less than what they currently owe on the property. This can be a great deal for prospective buyers but can require extra time to close. It is extremely important that you hire a Realtor well versed in short sales as this is something you do not want to navigate on your own. Depending on whether the short sale is active or contingent will determine if this listing is followed by an A or a C. Some sellers will continue to market their property active even after having submitted an offer to the bank for review. It is important that you know the status of the short sale before viewing the home.
REO (Real Estate Owned) Property
When a property has failed to sell at foreclosure auction ownership reverts back to the lender and becomes bank owned. REO’s can be great for some buyers. However, like short sales, the buyer needs to know what they are getting into.
Many foreclosed homes are sold AS-IS. There could be structural problems that buyers will know nothing about until they begin any renovations or home projects. A thorough home inspection is critical.
Navigating the real estate market can be challenging and hopefully this quick tutorial will assist you. Contact Real Estate Ink today and let our team of expert Realtors go to work for you.
